Mehabe score: 5 G Factor: 2 Piotski Score: 7 The stock has a rating OBSERVE & HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 2 and Piotski score of 7.
Description
Baba Arts is engaged in the business of Motion, Picture, Videotape & Television Programme Production Services. Site:BABA Main Symbol:BABA
Stock trades at 20.1, above its 50dma 16.65. It also trades above its 200dma 15.41. The stock remains bullish on techicals
The 52 week high is at 23.60 and the 52week low is at 8.32
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
Weakness
– Stock is trading at 5.02 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 8.98% for last 3 years.
-Earnings include an other income of Rs.1.28 Cr.
Competition
– The industry trades at a mean P/E of 33.2x. Saregama India trades at the industry’s max P/E of 69.5x. BABA trades at a P/E of 52.8x
– Industry’s mean G-Factor is 3.1 while the mean Piotski score is 8.0. BABA has a G-Factor of 2 and Piotski scoreof 7.
– Average 1 month return for industry is 8.9%. The max 1- month return was given by TV18 Broadcast: a return of 24.97 %
Quarterly Results
Sales for period ended Dec 2021 is Rs 8.91 cr compared to Rs 0.02 cr for period ended Dec 2020, a rise of 44450.0% .
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Company reported operating profit of Rs 1.1 cr for period ended Dec 2021 and operating profit margin at 12.3 % for same periodOperating profit was negative for the same period last year. Company has improved its margins this year.
The EPS for quarter ended Dec 2021 is Rs 0.15 compared to Rs 0.03 for previous quarter ended Sep 2021 and Rs -0.05 for Dec 2020.
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 14.55 cr for period ended TTM vis-vis sales of Rs 13.32 cr for the period ended Mar 2021, a growth of 8.5%. The 3 year sales cagr stood at 155.7%.
Operating margins expanded to 18.83% for period ended TTM vis-vis 15.54% for period ended Mar 2021, expansion of 329.0 bps.
Net Profit reported at Rs 3.06 cr for period ended TTM vis-vis sales of Rs 2.8 cr for the period ended Mar 2021, rising 8.5%.
Company recorded a healthy Net Profit CAGR of 30.1% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 16.0% compared to 9.0% over the last 3 Years. – The stock has given a return of 95% on a 1 Year basis vis-vis a return of 74% over the last 3 Years. – The compounded sales growth on a TTM bassis is -53% vis-vis a compounded sales growth of 111% over the last 3 Years. – The compounded profit growth on a TTM basis is -25% vis-vis a compounded profit growth of 40% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Dec 2021 fii holding stood at 0.0% vis-vis 0.02% for Sep 2021 – Public shareholding has remained largely constant. The Dec 2021 public holding stood at 25.32% vis-vis 25.3% for Sep 2021
Conclusion
– is almost debt free. – Stock is trading at 5.02 times its book value
-Though the company is reporting repeated profits, it is not paying out dividend
– has a low return on equity of 8.98% for last 3 years.
-Earnings include an other income of Rs.1.28 Cr.
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 16.65 and is trading at 20.1 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
